indonesia`s toll road development

INDONESIA’S TOLL ROAD DEVELOPMENT
Reynaldi Hermansjah
CFO PT Jasa Marga (Persero) Tbk.
Indonesia Australia Business Week
0
Jakarta, 18 November 2015
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1
National Development Mid-term Plan (2015-2019)
No
Projects
Baseline
2014
Objective
2019
1.
Seaport (number of port)
278
302
2.
Electricity Supply (GW)
50.7
85.7
3.
National Road (km)
1,202
3,852
4.
Toll Road (km)
807
1,807
5.
Railways (km)
5,434
8,692
6.
Airport (number of port)
237
252
2
Regulatory Framework
Current regulatory structure
 Jasa Marga has flexibility to invest in prospective toll road.
 Encourage more private participation in toll roads business – no limit on
foreign ownership.
 Competitive bidding environment with strict financial closure requirements on
winners.
Government
of Indonesia
(“GOI”)
Ministry of StateOwned Enterprises
(“MSOE”)
70%
Ownership
30%
Ownership
Public
Since 12
Nov 2007
Granting &
Supervising Toll
Road concessions
Minister of
Public Works
Indonesian Toll Road
Authority
(“BPJT”)
Concession Agreement
Directorate General
of
Highways
Ministry of Public
Works (“MPW”)
Road Network
Planning & Setting
of Technical
Specifications
Concession
Agreement
Private Toll Road Investors
Private Toll Road Investors
Private Toll Road Investors
3
Improved Regulations
Tariff
Land Acquisition
 Initial toll tariff is calculated based on  Land acquisition is Government’s
investment feasibility, toll road user’s
ability to pay and vehicle operating
cost saving. Investment feasibility is
calculated based on estimated
investment cost and projected
revenue
during
term
of
the
concession.
responsibility, is undertaken by land
procurement committee appointed by
the Government.
 Price is determined by independent
appraiser based on fair market price.
 Government provides a revolving
fund to acquire land in advance. Land
cost and availability is secured,
because investor should repay land
cost only after land is fully acquired.
 Initial toll tariff is stipulated in
concession agreement prior to start of
construction.
 Tariff adjustment is regulated by law,  Government guarantees maximum
is calculated based on CPI and is
adjusted once every two years.
land price to be compensated by the
investor (land capping scheme).
 Initial toll tariff setup and subsequent
adjustment is decided by Minister of
Public Works decree.
4
4
Stages of Land Acquisition (Based on UU No. 2/2012)
The new land acquisition law carries the following main points:
• Fair price is determined through independent appraisal.
• Land owner may choose to reject through court, yet court has to decided in 30 days (final).
• After transaction process (normal) or by court verdict, project can commence.
• Re-settlement is also an option.
• The Government should carry out socialization far in advance (transparent).
• BPN (National Land Agency) is the only body responsible for land acquisition for public interests.
5
Implementation of Viability Gap Funding (VGF) from the
Government
Medan-Kualanamu-Tebing Tinggi Toll Road
Belawan-Tanjung Morawa
Toll Road
Length
Investment
Cost
61.7 km
Rp 4.07 trillion
17.8 km
43.9 km
Notes :
Constructed by Government
Constructed by Investor
6
Implementation of Viability Gap Funding (VGF) from the
Government
TRANS JAVA TOLL ROAD
SOLO-NGAWI (90.1 KM)
NGAWI-KERTOSONO (87.02 KM)
Investor
Section
Land
Acquisition:
96%
Construction:
40%
Length
Investment
Cost
Solo-Ngawi
90.1 km
Rp 5.14 trillion
Ngawi-Kertosono
87.02 km
Rp 3.83 trillion
Notes :
Constructed by Government
Constructed by Investor
7
Toll Road Operator in Indonesia with 37 Years of Experience
Start
Operation
1978
1983
1984
Jagorawi
1986
SurabayaGempol (4)
Semarang
1987
1988
1990
Padaleunyi
JakartaCikampek
Jakarta-Tangerang
Toll Road
Concessions
1998
2001
2003
2009
2011
Cipularang
Palikanci
Ulujami-Pondok Bogor Outer
Ring Road
Aren
BORR
Jakarta Outer
(Section 1)(2)
Ring Road
(JORR)
Surabaya-Mojokerto
(Section 1A)(2)
Belmera
Prof. Dr. Ir.
Sedyatmo
1991
Jakarta Inner
Ring Road
(JIRR) (1)
2013
2014
2015
JORR W2 North
(Section 1-4)(2)
BORR
(Section 2 & 3)(2)
Semarang-Solo
(Section 2)(2)
GempolPandaan(2)
BORR
(Section
2A)(2)
GempolPasuruan(2)
SemarangSolo(2)
Cengkareng-Kunciran(2)
Semarang-Solo
(Section 1)(2)
Kunciran-Serpong(2)
Surabaya-Mojokerto(2)
Nusa Dua-Ngurah
(2)
Rai-Benoa
Medan-Kualanamu-Tebing Tinggi(2)
Solo-Ngawi(2)
Ngawi-Kertosono(2)
Cinere-Serpong(2)
Number of
Concessions
1
2
4
6
7
8
9
10
11
12
13
14
16
17
18
19
26
Total Length (km)
under
986.81
59
84
131 223
246
329
394
437
463
469
527
531
544
554
576
590
Corresponding
(3)
Concessions
Note: (1) Jakarta Inner Ring Road (JIRR) is comprised of the Cawang-Tomang-Pluit concession granted to Jasa Marga and Cawang-Tanjung Priok-Pluit concession granted to CMNP.
(2) Jasa Marga’s newly acquired toll road concessions.
(3) The cumulative length of road represents the current total road length that corresponds to key toll road concessions in this table, not to the year where the concession started.
(4) Porong-Gempol Section (5 km) within Surabaya-Gempol Toll Road has officially been closed due to force majeure (mud) since 2006.
8
The Largest Toll Road Operator in Indonesia
 Manages and operates 590 km of toll roads in Indonesia – 63% share.

Urban concentration in Jakarta metropolitan area – some of Indonesia’s busiest toll roads.

Regional concentration in Java and Sumatera – most populated islands in Indonesia.
Strait of
Malacca
:Operated before 2004
NORTH SUMATERA
 Belmera: 42.70 km
 Medan-Kualanamu-Tebing Tinggi: 61.70 km
GREATER JAKARTA & WEST JAVA
SUMATRA
 Jagorawi: 59.00 km
 Jakarta-Tangerang: 33.00 km
 Ulujami-Pondok Aren: 5.55 km
 Jakarta Inner Ring Road: 23.55 km
 Prof. Dr. Ir. Sedyatmo: 14.30 km
 Jakarta-Cikampek: 83.00 km
 JORR: 43.10 km
 Cikampek-Padalarang: 58.50 km
 Padalarang-Cileunyi: 64.40 km
 Palikanci: 26.30 km
 Bogor Outer Ring Road: 11.00 km
 Cengkareng-Kunciran: 14.19 km
 Kunciran-Serpong: 11.19 km
 JORR W2 North: 7.70 km
 Cinere-Serpong: 10.24 km
: 13 new projects on
the pipeline,
operating in stage
since 2009.
MALUKU
SULAWESI
KALIMANTAN
PAPUA
Java Sea
Banda Sea
JAVA
BALI
CENTRAL
JAVA
Indian Ocean
 Semarang: 24.75 km
 Semarang-Solo: 72.64 km
 Solo-Ngawi: 90.1 km
 Ngawi-Kertosono: 87.02 km
Greater Jakarta: 275 km (47%)
EAST JAVA
 Surabaya-Gempol: 49.00 km
 Gempol-Pasuruan: 34.15 km
Timor Sea
 Surabaya-Mojokerto: 36.27 km
 Gempol-Pandaan: 13.61 km
BALI
 Nusa Dua-Ngurah Rai-Benoa: 10.00 km
Non-Greater Jakarta: 315 km (53%)
9
Jasa Marga New Projects
Jasa Marga’s New Toll Roads
Expiration
Length
(km)
Investment Cost
(Rp trillion)
Jasa Marga
Ownership
1. Bogor Outer Ring Road (1)
2054
11.00
0.98
55%
2. Semarang-Solo (part of Trans Java) (2)
2055
72.64
6.21
73.91%
3. Gempol-Pasuruan (part of Trans Java)
45 years from effective date
34.15
2.77
97.02%
4. JORR2 (Cengkareng-Kunciran)
35 years from effective date
14.19
3.51
76.20%
5. JORR2 (Kunciran-Serpong)
35 years from effective date
11.19
2.62
60%
6. JORR W2 North (road section of JORR) (5)
2044
7.70
2.15
65%
7. Surabaya-Mojokerto (3)
2049
36.30
3.22
55%
8. Gempol-Pandaan
35 years from effective date
13.61
1.17
89.17%
9. Nusa Dua-Ngurah Rai-Benoa (4)
45 years from effective date
10.00
2.48
55%
10. Medan-Kualanamu-Tebing Tinggi
40 years from effective date
61.70
4.07
55%
11. Solo-Ngawi (part of Trans Java)
35 years from effective date
90.10
5.14
59.99%
12. Ngawi-Kertosono (part of Trans Java)
35 years from effective date
87.02
3.83
59.99%
13. Cinere-Serpong
35 years from effective date
10.24
2.2
55%
459.84
40.35
Concession/Section
TOTAL
Notes: (1) Section 1: Sentul-Kedung Halang (3.85 km) is operated since 23 November 2009; Section 2A: Kedung Halang-Kedung Badak (1.95 km) is operated since 04
June 2014.
(2) Section 1: Semarang-Ungaran (10.80 km) is operated since 17 November 2011; Section 2: Ungaran-Bawen (12.30 km) is operated since 04 April 2014.
(3) Section 1A: Waru-Sepanjang (2.30 km) is operated since 05 September 2011.
(4) Operated since 01 October 2013.
(5) Section Kebon Jeruk-Cileduk (5.70 km) is operated since 04 January 2014; Section Cileduk-Ulujami (2.00 km) is operated since 22 July 2014.
(6) Section Gempol-Pandaan (13.61 km) is operated since 12 June 2015.
10
Greater Jakarta Toll Road Network
Integrated toll road network
in and around Greater
Jakarta.
11
Toll Road Network in Java Island
12
Indonesia’s Toll Road Traffic Volume
Jasa Marga operates most of the busiest toll roads in Indonesia.
Average Daily Traffic Volume Transaction* (December 2014)
‘000 cars per day
(80%)
Toll roads operated by Jasa Marga
Toll roads operated by others
Notes(*):
(1) Average daily traffic volume is calculated by dividing traffic volume by 365 days.
(2) All data are based on traffic volume until 31 December 2014.
(3) When not available, data on other companies are based on the closest estimation of available data.
13
Resilient Industry: Insensitive Traffic Volume
Fluctuating car sales growth in Indonesia has minimal impact to our traffic volume,
however increase in car sales will contribute to higher traffic volumes in the long
run.
Traffic on Jasa Marga’s Toll Roads
Car Sales
(thousand)
Direct impact
of economic
crisis
Source: GAIKINDO (2)
(million)
Direct impact of
fuel price hike (1)
Source: Jasa Marga
Note:
(1) Fuel price increased significantly in October 2005 but the full impact in car sales was only felt in 2006.
(2) Gabungan Industri Kendaraan Bermotor Indonesia (The Association of Indonesian Automotive Industries).
14
High Growth of Quality Asset for Sustainable Revenue Growth
Jasa Marga’s expansion from current new projects will accelerate the asset value with the
capability to generate high and sustainable revenue growth.
Revenue Growth
Asset Growth
(Rp trillion)
90.07
18.48
7.23
31.86
2014A
(Rp trillion)
2020F
2014A
2020F
15
THANK YOU
16